Stay Short EUR/SEK and GBP/USD. Enter Long NZD/USD
I sold EURSEK at 8.7315 expecting Risksbank to keep rates on hold while the ECB leans toward easing in 2013 as recession lingers. I added to the position at 8.6409 as a corrective rebound launched in early January faltered. My initial target of 8.4994 has been met and I am now aiming for 8.4150.
I continue to hold short GBPUSD at 1.5662. Prices have turned lower anew after a brief recovery and I will continue to hold short, targeting 1.5440. A stop-loss will be activated on a daily close above 1.5878.
I have now also entered long NZDUSD at 0.8509 as prices compeleted a bullish Ascending Triangle chart pattern. I am initially targeting the August 31 2011 high at 0.8571 with a stop-loss set on a daily close below 0.8460. A breach above 0.8571 on a daily closing basis will prompt a revision of the stop-loss to breakeven mark and expose a larger objective at 0.8788, the measured Triangle target and 2011 closing high.
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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